City Salaries on the Rise as Banks Face Hunt for Staff

City Salaries on the Rise as Banks Face Hunt for Staff

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Byline: JAMES ROSSITER

CITY salaries are on the rise as banks struggle to find enough suitably qualified juniors to work on their burgeoning pipeline of deals.

New job vacancies in banking and fund management in April were up 20.4% on the same month last year, while salaries for the "middle market" - analysts and financial controllers - rose 4.63% month on month, recruiter Morgan McKinley reports.

By April most banks have paid out performance- related bonuses for the prior year. Any lock in period has usually also expired after which staff can leave without having to repay any of the cash portion of their bonuses.

Banks know, therefore, now is the easiest time to poach staff from rivals but a shortage of talent is forcing them to boost salaries for both newcomers and existing staff, who are negotiating "buybacks" - new contracts - as a reward for not leaving to join rivals.

Big US firms including Citigroup, Goldman Sachs and Morgan Stanley, and Europeans including UBS and Deutsche, have just reported record or near-record first-quarter earnings and anticipate healthy deal activity to come. …